Background

  • Stockholm Exergi is the owner and operator of the largest and most versatile district heating and district cooling provider in the Nordics
  • Stockholm Exergi provides highly environmentally sustainable district heating for both corporate and residential customers across seven municipalities in Stockholm County, and critical electricity capacity to the Stockholm electricity grid
  • Stockholm Exergi serves more than 800,000 end-users and generated an EBITDA of SEK 2.8bn in 2020
  • Stockholm Exergi's energy production is based almost entirely on renewable and recyclable energy sources, together accounting for 99% of the fuel mix in 2020. Notably, coal has been entirely phased out in April 2020 (two years ahead of schedule) as part of Stockholm Exergi’s goal of being “climate positive” by 2025

Process

  • DC Advisory (DC) was engaged by the Consortium to provide buy-side M&A and debt advice to support its acquisition of Stockholm Exergi
  • DC leveraged its extensive experience and deep sector knowledge to prepare the Consortium significantly in advance of the process
  • DC’s advice included:
    • Process and bid strategy
    • Review and analysis of the business plan
    • Coordination of due diligence advisors
    • Debt strategy, discussions with ratings agencies and negotiations with potential lenders
    • Financial modelling and valuation
    • Supporting negotiations with the seller and its advisors; and
    • Advice on transaction documentation

Outcome

  • The Consortium entered into a definitive agreement to acquire a 50% stake in Stockholm Exergi on 30 June 2021
  • The transaction meets the Consortium members’ ESG focus and commitment to investing in sustainability focused businesses
  • This transaction further demonstrates DC’s expertise in the energy sector and strengthens the firm’s track record of advising on transactions in Nordic and Baltic countries